There are two principal routes for the commercial production of ethanol. One procedure is based on petrochemical technology. Starting with Ethylene, ethanol is produced by means of the catalytic hydration of this olefin. While this process is efficient, it has the disadvantage of depending on a supply of ethylene, which historically has experienced price volatility.
The second method relies on the fermentation of sugar, either derived from corn or sugar cane. A major drawback to fermentation processes is the fluctuation in the prices of the commodities, corn and sugar. To a large extent, the fermentation industry has depended on government subsidies to remain competitive.